Imagine a scenario where a homeowner’s heating system is leaking water. If the problem goes unnoticed in the basement, the homeowner is on the hook for thousands of gallons of wasted water. Now imagine the water utility has the ability to detect that the water has been running at this home for twenty-four hours. The utility can help solve the wasteful situation before it becomes an expensive problem. Current technology makes this possible.

Discussion of the “smart grid” has focused largely on electric utility infrastructure; however, there is great potential in using the same technology at water utilities. As the expense of delivering water rises and cities experience water shortages, the need to reduce loss will increase. Water utilities will increasingly turn to advanced metering infrastructure (AMI) to detect leaks and unpaid use—enabling a utility to reclaim a significant percentage of loss.

AMI Improves Accuracy and Expands Customer Services

To put a local perspective on these enormous figures, consider the City of Quincy, Massachusetts. After discovering a significant operating cost shortfall, a 2007 audit of its water utility revealed that 31% of Quincy’s master water meter use was not transferred to the customer due to leaks, incorrect meter readings, or unread meters.

To begin solving this problem, Quincy hired an outside firm (Woodard & Curran) to recalibrate its master water meter and to replace approximately 18,000 outdated residential meters with advanced meters. Many of the meters in use in the City were over fifty-years old, and a significant number were not operating. The use of old manual read meters also required an inefficient meter reading and billing process. It would take up to six months to read the City’s meters. Since meters were only read once, quarterly billing was based on estimates of how much water was used in a particular area. In addition, some meters were not read at all due to lack of labor to assign to the task.

Quincy’s meter upgrade project, completed in several phases, also included installing a fixed network auto­matic meter reading (AMR) system that could read all meters twice a day. The City’s consulting firm for this project performed extensive research on a wide range of meter types and meter reading systems, and based on a detailed study, the firm recommended the installation of a fixed-antenna radio system to read all of the municipal water meters in the City.

Moving to an AMR system reduced the City’s of Quincy’s unbilled water loss to 18%.

The new system also significantly reduces meter-reading costs and time spent on billing issues, which were the source of 90% of the utility’s billing disputes and accounted for 30 to 40 hours per week of phone time. The ability to receive meter readings automatically and electronically will allow the utility to reallocate this inefficient time and allow distribution crews to focus on more critical infrastructure repairs.

Increasing Revenue and Payer Equity

Like Quincy, The City of Lawrence, Massachusetts had been struggling with accuracy and unbilled meter issues, but the City was unsure if they could justify the time and expense associated with upgrading meters. Working with the City, Woodard & Curran conducted a sample rate study and found that many meters were under-registering or inaccessible (requiring an estimate). For example, with a new meter installed, a Laundromat registered a 733% increase in use. With the old meter and estimated billing system, the Laundromat paid $639. Their new bill with the accurate reading would bring in more than $4,600 in additional revenue for the City. In another sample, a restaurant meter was inaccessible and its water use was estimated. With the new meter, and an accurate reading of actual use, the City realized a 233% increase in its revenue.

Rate payers are generally in favor of fairness in billing, and with greater accuracy, Lawrence can ask users to pay their equitable share.

Again, working with Woodard & Curran, Lawrence, MA used a procurement strategy in which the city bid the project in two phases. The first phase was furnishing and setting up a fixed network automatic meter reading system through a Request for Proposals (RFP) process based on a technical evaluation. The second phase was purchasing and installing approximately 13,000 residential, commercial, and industrial meters and installing transmitters through competitive low-price bidding.

Rather than choosing an equipment vendor to design and implement the entire system, this two-step process enabled the City to obtain firm pricing on preferred water meters for the lowest price and a meter reading system that met specific evaluation criteria and best served the needs of the City.

“The amount saved through operational efficiencies and the increased revenue the City is seeing by replacing water meters is remarkable,” said John Isensee, Public Works Director in Lawrence. The new water meters provide a higher degree of accuracy and are projected to increase annual revenue by $1.3 million.

A municipality does not need to update their entire system all at once. Commercial and industrial operations alone account for a significant percentage of total water use in many municipalities. For example, the Lowell Regional Water Utility in Massachusetts replaced approximately 1,000 commercial and industrial meters and installed a fixed network AMR, and the utility expects to increase revenue by $500,000 annually.

AMI and AMR May Require Additional Network Infrastructure

When Lowell replaced its municipal meters, it also installed an AMR that would serve the City well in the future when it had the resources available to implement meter upgrades for its residential customers.

Many utilities have some type of existing wide area network (WAN) infrastructure in place to communicate with remote services. However, an analysis of existing wireless technology is generally required when considering an AMI/AMR system. If equipment is aging or discontinued (making technical support challenging) and radio frequency is found to be crowded, upgrades are generally required. Steps should also be taken to harden and secure the network.

Since most of these systems are now connecting to the internet and other business systems (rather than a stand-alone narrow-band serial radio running Modbus, DNP3, or other protocols) it makes it imperative to implement proper security practices. Most of these networks allow remote access via tablets and smart phones, and operators or contracted staff are logging in daily. This increases security risk and the need for more procedures, logging, protection measures, and risk assessments.

AMI Enhances Data

Some AMI technology allows for daily readings, which utilities and residents can use to monitor actual rather than estimated water use, which improves conservation efforts. This enables the user or the utility to detect sharp spikes in use—often the result of leaks or something left running like a heating system in the example above or even a running toilet.

Reduction measures not only ease demand on local water resources, they also reduce the energy and expense required to deliver that water. According to UN Water, about 8% of global energy generated is used to pump, treat, and transport water to consumers.

AMI sensors and hardware can also provide backflow detection, pressure and temperature readings, acoustic monitoring, and automatic shutoff where needed. Utilities also have the ability to use geographic data to create individual water budgets for businesses, households, or neighborhoods along with more sophisticated rate structures. For example, a utility could charge higher rates at specified intervals when a consumer exceeds their budgeted use.

AMI offers many economic benefits and makes solid business sense for most communities. Often, the additional revenue gained through the system improvements pays for the debt service. By using the right procurement strategy, communities stand to increase the efficiency and reliability of their water systems while adding much needed revenue.